US estimates of the natural rate of interest–the real short-term interest rate that would prevail
absent transitory disturbances–have declined dramatically since the start of the global …

The trend in the world real interest rate for safe and liquid assets fluctuated close to 2% for
more than a century, but has dropped significantly over the past three decades. This decline …

Why are interest rates so low in the Unites States? We find that they are low primarily
because the premium for safety and liquidity has increased since the late 1990s, and to a …

Persistently low real interest rates have prompted the question whether low interest rates are
here to stay. This essay assesses the empirical evidence regarding the natural rate of …

A large output gap accompanied by stable inflation close to its target calls for further
monetary accommodation, but the zero lower bound on interest rates has robbed the …

In this article, we provide a model of the macroeconomic implications of safe asset
shortages. In particular, we discuss the emergence of a deflationary safety trap equilibrium …

The interaction between capital requirements and monetary policy is assessed by means of
simple rules in a dynamic general equilibrium model featuring a banking sector. In “normal” …

Macro-finance theory implies that trend inflation and the equilibrium real interest rate are
fundamental determinants of the yield curve. However, empirical models of the term …

We examine the behavior, determinants, and implications of the equilibrium level of the real
federal funds rate, defined as the rate consistent with full employment and stable inflation in …

The argument that uncertainty about monetary and fiscal policy has been holding back the
recovery in the US during the Great Recession has a large popular appeal. This paper uses …